Medicare Advantage plan spending and payments under the hospice carve-out

Medicare Advantage plan spending and payments under the hospice carve-out
JAMA Network Open; by Meghan Bellerose, Andrew M Ryan, Claire K Ankuda, David J Meyers; 8/25
In 2021, the Centers for Medicare & Medicaid Services implemented a Value-Based Insurance Design (VBID) model to test the impact of including hospice services in the Medicare Advantage (MA) benefits package. In December 2024, the VBID was ended following widespread dissatisfaction ... Under the carve-out model, after an MA enrollee elects hospice, health care related to their terminal illness is paid for by fee-for-service (FFS) Medicare. MA plans stop receiving the inpatient and outpatient portions of that enrollee's capitated payment but continue to receive premium and rebate payments. In this cross-sectional study, MA plans received high premium and rebate payments for beneficiaries enrolled in hospice despite low health care spending after enrollees elected hospice. To reduce excess payments, the Centers for Medicare & Medicaid Services could require MA plans to submit information on enrollees' use of supplemental benefits and adjust payments made after election of hospice to align with spending.